Five for Friday | 五日(星期五)

Happy Hallowe’en everyone. Things that made my day this week:

Mr Switch’s winning set from the DMC mixing championship

Tai Ping Advertising Co. Limited’s advert for Audi is as much an advertisement for the city as the car

Carli Davidson shake puppies video is just too awesome

Ice Cube on Sesame Street. I can’t believe I just wrote that, but this is for real

And finally for more serious content, a great article in Advertisng Age about Kraft getting real about online advertising, I am curious to know what took them so long and how this will impact online advertising around the world.

I like: Ling Valentine on her business Ling Cars

Ling Cars looks like someone fed a car dealership through Geocities, but it’s entertaining and it works. It is a characture of Chinese language websites that often look a lot busier in terms of design than their western counterparts. This is partly due to culture and typography.  Over the space of 30 minutes Ling Valentine talks about her approach below

Links of the day | 在网上找到

The Laborers Who Keep Dick Pics and Beheadings Out of Your Facebook Feed | WIRED – moderation might make up half the staffing of social media sites – wow

China’s Assault on Corruption Enters the C-Suite | WSJ – could also be encouraging management to move the business out of the state sector

HP Eyes Chinese Partner For Router Division | Young’s China Business – not convinced about the upside for Huawei given that it has already build an enterprise business

Programmatic buying no solution without data breakthrough | Campaign Asia – data sharing a key issue

China Mobile’s ARPU Drops While Net Profit Sinks 9.7% – voice calls and SMS down presumably due to OTT messaging services

Daring Fireball: Retailers Are Disabling NFC to Block Apple Pay – not convinced but it is an interesting move, they think that mobile wallets give them a chance to disintermediate merchant services (bank debit card services, credit card services, charge cards)

LG unveils Nuclun, its very own smartphone chip | The Inquirer – interesting move by LG; a stratagem to cut costs and differentiate in a commoditised Android handset marketplace. Expect the chipset to move into other consumer electronics

Want to dance? Cabinet approves revised law easing regulations on dance clubs | Asahi Shimbun – Japan eases laws that was killing its dance music scene, probably about the Olympics in 2020. The LDP will be kill joys on nightlife in the future again

Facebook and Yahoo Find a New Way to Save the Web’s Lost Email Addresses | WIRED – Aol should be crying out be part of this as well surely?

The Asian Luxury Market Is Stumbling – Business Insider – Thailand and Hong Kong apparently

footnoted* — What’s $8m to Google? – interesting article about Nikesh Arora. Is this similar to his departure from T-Mobile?

Procter & Gamble Sets Duracell on New, Independent Course – – interesting move, how will it affect Duracell distribution?

High-tech jewellery to help you unplug | Tech blog – interesting and smart (from a design perspective) lack of ambition for the devices, context is king

William Gibson: The Future Will View Us “As a Joke” | Mother Jones – any interview with William Gibson is a good thing

Peak Google | stratechery by Ben Thompson – interesting article

Apple Strengthens Pull of Its Orbit With Each Device – – interesting analysis – Google is going on a similar trajectory and Microsoft has already been there for a while (paywall)

Luxury goods: The end of ostentation | Campaign Asia – APAC markets less interested in flash luxury (paywall)

Tod’s ignites ecommerce sales with online only handbag promotion | Luxury Daily – limited edition bag rather than discounts

Material Design Icons | Prosthetic Knowledge – Google have open sourced a pile of icons

False and misleading? Advertising on social media in China and Hong Kong | Freshfields – great summary of the legal position (PDF)

Quick Reply – PressRush – interesting idea for the media

94% of Chinese shoppers research on mobile while in-store. | Resonance China – comparison numbers with other countries in Europe

China collecting Apple iCloud data; attack coincides with launch of new iPhone | – probably implemented to deal with the increased device security that the FBI is wringing their hands about

Things that made my day this week

A bit later than the Friday post that I usually do, here are the things that made my day this week:

Dorothy by iStrategy Labs is a really interesting use of haptic for discrete navigation information

Kovert Designs seem stop be taking a similar approach with their jewellery; as does Casio with their BlueTooth G-shocks.

I am really looking forward to William Gibson’s new book and this interview with American magazine Mother Jones shows that he has not lost his edge:   William Gibson: The Future Will View Us “As a Joke” | Mother Jones

Porter’s collaboration with Isaora are always interesting, but I have really fallen for the Filo pack, with its digital smoke print. Unfortunately I can’t justify buying it because I have a perfectly good Mystery Ranch bag.

I really like this physical interface designed for use on iPads. The pictures under glass interface has its limitations which this design draws attention to it.


Barbarians in the valley

Over the space of one life time the below San Francisco around the Santa Clara valley went from apricot farms and orchards to urban development based around hardware (the silicon in silicon valley) and then on to campus design sites preferred by software companies.

At the time of the PC revolution was kicking in, which gave use the consumer side of consumer technology we live with today like iPhones and the MacBook Pro this post is written on.

Over the space of this time, it wasn’t only the landscape that changed but the way we work and entrepreneurship was rewarded. There were decades of unparalleled economic growth driven by companies firstly in hardware, then software and finally in networking and communications – the internet.
During the early 1980s, America had Ronald Reagan as president. The manufacturing industry that had driven post-war prosperity in the country was suffering from global competition and businesses were under attack. This was the golden age of the corporate raider who destroyed businesses in the name of shareholder value. Carl Icahn was considered responsible for the bankruptcy of Trans-World Airlines (TWA).

By comparison Silicon Valley was in a spate of explosive growth. Computers and software were changing the way business operated. Spreadsheet software enabled the kind of models required for corporate raids on main street. Apple, Adobe and Aldus came up with the different components required for desktop publishing revolutionising design in the process.
The fall of the Berlin Wall - November 1989
The cold war ended and the Berlin Wall came down, corporate raiding ran out of steam as corporate lawyers began to construct effective barriers on behalf of besieged companies. Silicon Valley started a move away from ‘hard’ innovation to the soft innovation of gadgets, software and services. But that was fine, there where other places in the world who wanted to make the hardware components because of the jobs and wealth it created. The modern internet started to be built on Sun and Silicon Graphics servers connected with Cisco routers. The web was designed on the same Apple Macs that designed brochures.  Technology companies became media companies, retailers and super-fast courier companies. Wired magazine talked about the ‘new economy’.

The industry was also riding on a one-time offer. Older computers that now ran the modern world had a ‘millennium’ or Y2K bug, which was a bonanza for business IT companies. A dot com bust dampened enthusiasm, cleared out some of the more egregious business models.  Out of the fire sales of Aeron chairs and Cisco Catalyst series routers paired with cheaper broadband came web 2.0 – where the web became a platform rather than just a catalogue.

For many of the previous businesses in Silicon Valley growth slowed. Most business software looked like a solution looking for a problem. High-performance hardware could be cheaply replaced with more commodity priced boxes. Eventually for many people’s needs, hardware became a service that could be rented according to need. Business models were disrupted, sales dried up, licences weren’t renewed and advertising sales dried up.

Enterprise software companies were hoovered up by private equity firms eager to leverage their steady cashflows to service debt from further transactions.

Businesses like IBM and Nokia look like the TWA or Goodyear Tire and Rubber Company in the 1980s. The story of Yahoo! over the past six years looks like one corporate raider greenmail scam after another. Jerry Yang who has recently started to see his reputation rehabilitated was turned out of the company he founded by shareholders influenced by Microsoft and Carl Icahn. The subsequent replacement Carol Bartz supervised over a spectacular desstruction in value at the company. Current CEO Marissa Mayer, like her peers at Apple and IBM faces constant corporate raideresque behaviour to leverage up and return money to shareholders as part of a share buyback.

Microsoft who seemed to have used corporate raiders against its foes like Yahoo! now has activist shareholders on its board and is being forced to rejig its own business.

Just what is going on?

I think it it down to a confluence of different factors:

  • Technology has had a spectacular growth spurt in Silicon Valley but the growth has spread beyond the valley. Huawei is arguably one of the most important companies in telecommunications and internet infrastructure now. Just over two decades ago it was a small business selling secondhand company switchboards to the new businesses springing up in Shenzhen. Zhengfei Ren moved from selling equipment he sourced in Hong Kong to manufacturing it himself. Now the company makes everything from core network switches and submarine cables to smartphones, tablets and wearables. Shenzhen is full of companies like Huawei – some more successful than others. The most powerful names in silicon are also Asian companies TSMC and Samsung Electronics play a key role in the manufacture of non-PC style computers: phones, tablets and even televisions. It is often easier to name products that aren’t becoming ‘smart’ in some way
  • There isn’t the same willingness in the US to fund start-ups looking at smart innovation, instead the focus is on areas like social applications. Technology industry veteran Judy Estrin identified this as a key problem in her 2008 book Closing the Innovation Gap: Reigniting the Spark of Creativity in a Global Economy. There are serious technology challenges available that need to be addressed: the break down of Moore’s Law in semiconductor manufacture, commercially viable nuclear power and quantum computing to name but three
  • The technology has been demystified and is yet another industry. There isn’t that much difference between LVMH and Apple or Caterpillar and Oracle. Software as a service moved the buying decision on a number of products from the IT manager to the marketing manager or department head. Cheaper smartphones saw the rise of bring your own device (BYOD) policies. I sat in an old warehouse turned conference centre last week when announced off the stage that ‘Designing hardware isn’t hard, filling Wembley stadium, that’s hard’. Eco-systems from OEMs to Kickstarter have democratised and demystified technology businesses. And with this familiarity has come at least some contempt

More information
Closing the Innovation Gap: Reigniting the Spark of Creativity in a Global Economy
Finding Alibaba: How Jerry Yang Made The Most Lucrative Bet In Silicon Valley History | Forbes
Yahoo Stock Crashes As Alibaba IPOs – Business Insider
Marissa Mayer’s day of reckoning at Yahoo is rapidly approaching | Quartz
BlockBuster: Lyme Regis Sues Icahn, Accuses Sabotage –
Carl Icahn 2.0: an icon of ’80s greed is back to shake up Silicon Valley | The Verge – 2 words: TWA, Yahoo!